Labor's Spending Habits Leaving Australians Poorer: Former RBA Governor

Former Reserve Bank of Australia (RBA) governor Phil Lowe has criticized the Labor government's spending habits, saying they are making Australians 'poorer'.

Lowe argues that at a time of full employment and high commodity prices, the government should be running sizable surpluses rather than deficits.

In an interview with economist Adam Creighton for an Institute of Public Affairs podcast, Lowe stated, 'We find ourselves running sizable budget deficits at a time where we're at full employment and commodity prices are very high. We should be running sizable surpluses.'

Lowe also warned that the problem would become even more serious if weak economic growth left future generations without a larger economy to service the debt.

Assistant Treasurer Daniel Mulino pointed to $64 billion in savings and reprioritisations in the government's latest Budget but declined to say whether government spending was contributing to high inflation, saying only that the government would 'manage the budget responsibly.'